This article has been updated to include a letter from Commonwealth Charter Academy’s legal team sent Friday regarding alleged inaccuracies in the report “Our Taxes, Their Slush Fund” and a response by Education Voters of Pennsylvania.
A new report released Monday has uncovered even more questionable spending of taxpayer dollars by Pennsylvania’s leading cyber school.
The Education Voters of Pennsylvania report “Our Taxes, Their Slush Fund” shows that Commonwealth Charter Academy has spent millions of taxpayer dollars for dining out, car dealerships, entertainment venues, and at least one exclusive private club where members are invited to, “Celebrate the good stuff. Wine. Food. Whiskey. Getaways and special events.”
What the new report found
Ed Voters of PA submitted a Right To Know request for CCA’s check register from the 2021-2022 and 2022-2023 school years. What they found was some highly questionable use of taxpayer money.
“Family mentors” and “Student/caretaker”
CCA made over 2,500 payments to these two categories. The amounts were anywhere from $30 up to $7,425. This appears to be money that goes directly to the families, but that may never actually be clarified. Ed Voters filed a Right To Know request asking for documentation or contracts showing the work the redacted recipients of these payments were hired to do, and CCA replied that they do not have “any records in its possession, custody, or control that are responsive to your request as submitted.” That would seem to suggest that there are no contracts or agreements and that these payments were not made as compensation for some specific work.
Staff
766 payments were made to “staff” for a total of $749,170. There is no indication which staff were being paid.
That omission of information may seem like a picky detail, but right now you can look up the salaries of any Pennsylvania public employee whose salary is funded by taxpayers, including local teachers. A taxpayer is entitled to see their local district’s teacher contract. Taxpayers are entitled to see where those dollars went — unless they went to CCA.
Dining and Entertainment
CCA spent $114,486 for dining out at dozens of restaurants, including Chick-fil-A, Texas Roadhouse, Franco’s Lounge, TGI Friday’s, Duke’s Riverside Bar, and Dockside Willie’s. Payments also included $2,739.70 to DoorDash and $5,504 to Mazza Vineyards.
CCA made 193 payments for entertainment and recreation, adding up to $404,717. Those included checks to Hersheypark, Top Golf Pittsburgh, Dave & Busters, Urban Air Trampolines, the Camelback Lodge and the Green Ridge Club. CCA also paid $4,000 to the Hill Society, the “celebrate the good stuff” club where “member benefits start at our valet stand.” CCA is listed on their website as a platinum corporate partner.
Vehicles
CCA has spent over half a million dollars on vehicles. CCA has not yet fulfilled a Right To Know request for invoices beyond four that note one new Agate Black Ford Explorer 4 x 4 and three new Ford Escapes. Ed Voters does not know who drives the vehicles or what purpose they serve. CCA also paid $33,737 to gas stations throughout the commonwealth.
Hotel stays
CCA made 141 payments totaling over $200K for hotel stays. Were these for staff, families, executives, or students? We don’t know.
Lobbying
CCA spent a quarter of a million dollars on lobbying services from at least three different companies.
Marketing
Ed Voters has shown in the past that CCA spends an extraordinary amount of money on marketing, paying for everything from an “ice level lounge” at a hockey stadium to floats in a parade. This batch of checks show CCA spending $8.8 million in advertising and promotion.
So what’s the big deal?
These all seem like perfectly normal and reasonable expenses for a business, including a business that operates schools. What is there to be bothered by here?
Compare CCA’s behavior to the actions of your local public school. Your local school district (unless you’re in Philadelphia) is run by elected board members who are directly accountable to the taxpayer. They hold public meetings and must make all their decisions in public. The school district is required to operate with complete transparency, required to account for every cent given to them by the taxpayers.
Cyber charters like CCA operate with privately selected board members, operating with little transparency. And when they are forced to let some sunlight in, what we find is taxpayer money being spent in ways that your local district would never allow.
READ: New Report Gives Pennsylvania a C Grade for Its Support of Public Schools
I taught in Pennsylvania schools for almost four decades. When a student group wanted to take a field trip or hold a celebratory dinner, they had to raise the funds; taxpayer dollars could not be used for such activities.
It is also hard to imagine taxpayers—of the state—asking what exactly was the reason that these people were paid tens of thousands of dollars, and accepting the answer, “We don’t have that information.”
As the Ed Voters report states:
Every dollar that CCA spends on DoorDash or luxury vehicles, or at brew pubs or vineyards or exclusive clubs, is a dollar that was paid by a Pennsylvania taxpayer. These are dollars that are intended to be invested in educating the commonwealth’s public school students.
CCA has a history
The largest cyber charter in the state was launched in 2003 as Commonwealth Connections Academy. In 2011, the Connections Academy business was purchased from a group of investors led by Apollo Management, L.P.; the new owners were Pearson, the education behemoth that was trying to expand its tech-based business.
During these early, high-expansion days, K12 used Mickey Revenaugh as a lobbyist; Revenaugh was also the chair of the Education Task Force of ALEC, the notorious right-wing corporate bill mill. Revenaugh worked in ALEC with Lisa Gillis of K12 to write bills for states like Tennessee legalizing cyber charters (as detailed in this report from Education Week).
In 2016, they became Commonwealth Charter Academy (changing names without changing initials), apparently severing their connection with Pearson.
In 2022, an Education Voters report was critical of CCA’s use of taxpayer dollars to provide cash reimbursements to use as field trip money. Each student, according to CCA emails, receives a up to $250 “community class” reimbursement, as well as a $200 “personal field trip” reimbursement to cover any “instructional component” of the trip. Education Voters PA found discussion on the Facebook CCA parent page about using these funds for Dave & Buster’s Arcade, a Motley Crue concert, Eagles tickets, and family vacations to Universal Studios and Disney.
Education Voters PA also found that CCA offers one paid field trip per month; this is part of the more than 700 field trips offered for free. Those trips include academic trips and social field trips that include petting zoos, laser tag, bowling and kayaking. Additionally, CCA provides Instructional Technology Subsidy payments to families.
CCA’s real estate business
Where CCA really outshines other Pennsylvania cybers is in its real estate empire.
A previous Education Voters report finds that CCA has purchased 29 buildings since 2018, plus six previously-purchased properties and nine others that they lease.
CCA has paid a total of $88.7 million for properties; those properties have an assessed value of $43.1 million, according to the report. The properties are varied in type and use.
In 2020 near Pittsburgh, CCA purchased a redeveloped office complex that used to be a Macy’s. CCA had previously leased the first floor of the complex (about 70,000 square feet); now they own the whole building, while the same company they previously leased from manages it for them.
That same month, they spent $15 million on a the former headquarters of Ricoh in the Greater Philly area. (In that story we learn that there is such a thing as a “charter school niche broker,” in this case Avison Young, a nationwide real estate company).
READ: New Report Shows Pennsylvania’s Cyber Charter Schools Are Failing Black and Hispanic Students
Back in 2016, CCA bought the former PA State Employees Credit Union headquarters in Harrisburg for $5 million to replace several leased offices. They house headquarter offices there at the renamed 1 Innovation Way; PSECU is now one of their tenants.
In Johnstown, CCA purchased an office building and several nearby vacant lots. In Lackawanna County’s Moosic, CCA purchased the former Cigna building for $17,788,381 (the previous owners had the assessed value dropped to under $300K). In Dubois, CCA is planning to build an office complex on the vacant lot they purchased. In Erie, CCA bought the former Erie Business Center. In West Manchester, CCA spent $4.4 million on a building with an assessed value of $314K.
And they are still expanding. In Northwestern PA, Venango County officials just approved plans for a new CCA building in Cranberry Township, right next to a Home Depot and a Dollar Store.
It’s an awful lot of real estate square footage for a school that students do not have to physically attend. What is it for, exactly?
Tim Eller, senior vice president of outreach and government relations for CCA, said the properties “serve a variety of purposes, including work locations for staff; student state testing sites; student and family meetings with teachers, counselors, and administrators; student field trips; career and post-graduation planning; and enrollment as well as being open to members of the community for events and meetings for their local groups,” according to the Philadelphia Inquirer’s Maddie Hanna.
Business as usual
The lack of transparency and oversight, the vast piles of taxpayer money being used for purposes other than educating students — this is all part of now cyber charters in Pennsylvania work.
Pennsylvania’s 14 cyber charters collect over $1 billion in taxpayer funding every year, collecting the same per-pupil funding as brick-and-mortar charters. As the Ed Voters report points out:
Cyber charter schools educate students at home on a computer, not in a brick-and-mortar school. Cyber charter schools do not provide students with gym, recess, libraries, laboratories, or music and art classrooms. They do not need to employ security or maintenance/custodial staff or heat, cool, and maintain school district facilities and grounds. Their operational and overhead costs simply do not add up to equal those of traditional public schools – yet they receive the same amount of funding per student.
READ: This Election Actually Showed Americans Still Love Their Public Schools
Real estate holding, expensive marketing, and huge fund balances (unlike public schools, cyber charters have no limits on how much money they can park in the bank) — all of it paid for with taxpayer dollars.
These tax dollars are taken away from school districts that must account for every dollar they spend in public meetings and have oversight from locally elected school boards. These dollars are taken away from school districts that are unconstitutionally underfunded by more than $4 billion and that lack basic and essential resources that students need to be successful academically. They are taken away from school districts that are forced to raise property taxes year in and year out – so that they can pay cyber charter tuition bills that grossly exceed what these schools actually need to educate students at home on a computer.
Recommendations
The report ends with several recommendations.
The group calls for a flat cyber charter tuition rate of $9,500. They call for the state to conduct a forensic audit of CCA’s books, as well as the hiring of Department of Education staff whose only job will be to bring up to speed the several cyber charters that are working with expired charters.
The report also calls for a moratorium on new cyber charters. Pennsylvania already leads the nation in operating cyber charters, and is still considering applications for more. State lawmakers must take steps to reform cyber charter operations and spending “so that Pennsylvanians can have faith that their school property taxes are being invested in providing educational opportunities for students, not used as a slush fund by CCA to pay for dining, entertainment and whatever else they currently enjoy on our dime.”
Updates: CCA Legal Team Letter
Education Voters of Pennsylvania Response
